For the last 12 months we’ve been warned on an almost daily basis that the sky is about to fall in on media freedoms in Australia, but what does the legislation before parliament this week actually propose?

News Media (Self regulation) Bill 2013

There is one simple purpose to this legislation and it is not to stifle freedom of the press. Instead this bill simply creates the conditions under which the Public Interest Media Advocate (PIMA) can declare that an organisation is a “news media self-regulation body”.

The definition of a self-regulator rests on one condition: the body must have a self-regulation scheme that is binding on members.

The only other function of this bill is to remove a news organisation’s exemption from some provisions of the Privacy Act 1988 if it is not a member of a self-regulatory body recognised by the media advocate.

The effective clause of the Privacy Act is 7B(4) and as it currently stands, a news media organisation is only exempt from some Privacy Act provisions if it adheres to public standards. This new bill changes nothing in that regard.

That is it; that is all this legislation is aimed to do. The self-regulation scheme proposed in the bill is no tougher than the current rules and membership requirements of the Australian Press Council.Read the rest of this entry »

Fairfax launched its new compact size in a week where Victorian politics dominated the national agenda, making it a very good time to consider just how Melbourne’s former broadsheet, The Age, fared with its now similarly sized competitor, the Herald Sun.

The re-launch of The Age as a compact was never about being the biggest selling newspaper in Melbourne. There’s no way The Age can compete with the genuinely tabloid Herald Sun.

The Herald Sun is a modern giant among Australian newspapers: its audited Monday to Saturday circulation hovers around the 450,000 mark. That adds up to more than a million readers every weekday.

The Age sells roughly one-third: Monday to Friday (157,000) and about half (227,000) on Saturday. Readership is about half too: 566,000 Monday—Friday and 720,000 on Saturdays, according to Audit Bureau figures.

So the driver of this week’s move was re-attaching Age readers who’ve let their subscription lapse, or who hated the unwieldy broadsheet.

So far I would have to say that in terms of news bang-for-buck the Herald-Sun is doing tabloid better than The Age does compact. It’s early days I know, but in Melbourne, at least, the News Limited paper seems to be ahead in the stand-out front page stakes..

Though, having said that, it seems that The Age has picked up some new readers this week. At my newsagent’s pick-ups of The Age have more than doubled and are now equal to, or a bit better than the Herald-Sun. That could be an anomaly; I live in an area where there is a likely majority of Age-types given the number of private schools, Merc, Audis and Beemers that litter the neighbourhood.

Today’s editions (Thursday, 7 March ) might even the score for the Fairfax Media title in the stand-out competiton; but the full page picture of Ted Baillieu on the Hun might attract the mouth-breathers who like big pictures more than big words.

At least today The Age has learned that headlines should be short and sweet, but four words is still twice as many as two. Yesterday (Wednesday) it was seven words in a two-deck headline for The Age and four words in three-decks for the Herald Sun; the Hun also uses a much bigger typeface.

The issue here is that The Age is trying very hard not to look like a tabloid; it wants to be a smaller broadsheet and so it’s front pages are text-heavy.

This is OK as long as Age readers are happy to have the key elements of one or two stories related on page one. The Herald Sun is sticking to its formula of fear and emotion being the main drivers of sales based on front page scans.

Wednesday’s Herald Sun front page was a classic in that genre it had heart-string plucking sick baby Linkin Fauser and warring bikies raising “Police fear public could be caught in cross fire”.

At least The Age was back in the game yesterday with its own Baillieu stuff up story detailing secret fund raisers and the ongoing fall-out from the secret tapes affair that ensnared the Premier and his deputy in a rolling maul that was getting closer to the business end of the pitch.

But The Age was always playing catch-up on the secret recordings story. It seems likely that the Herald Sun had been sitting on this little box of dynamite for a while and deliberately played it out as a spoiler to the launch of The Age as a comp-loid on Monday of this week.

That is certainly how a smart newspaper executive would play it, both to boost sales and to let the opposition know that life in the tabl-act trenches would be bloody and tough.

Today it just got bloodier and tougher because it is the first time this week that we can do a full comparison on coverage of the same story. It was an even playing surface for both titles; they heard about Baillieu’s resignation at the same time (about 7.25pm last night [Wednesday 6 March] and so had about six hours to get the story ready for this morning’s papers.

The Herald Sun is rightly claiming Baillieu’s scalp and today reveals how political editor James Campbell dropped the paper’s bomb on the Liberal party late on Sunday afternoon.

It was the Hun’s story; though as I mentioned, The Age did well on Wednesday to get its own exclusive angle of the rorting and alleged corrupt shenanigans at the core of Baillieu’s incompetency.

Having said, that the depth of coverage was about the same in both mastheads and apart from the Hun’s own boasting about Sunday’s Spring street squirmfest neither paper had anything substantially new to add.

Friday’s papers will be telling. Does the Herald Sun have more dirt to dish?

If so it would be a hands down winner this week.

So for now, the Herald Sun gets to count coup, but The Age could have the last laugh.

If my newsagent is right and the new compact is walking out the door this week, then The Age may win the circulation battle.

The hope in the Fairfax Media offices along Spencer street is that novelty-factor sales turn into subscriptions.

The Fairfax Media AGM took place in Melbourne today against a backdrop of financial meltdown in the company’s fortunes. The share price — currently at 38 cents — has halved since the beginning of the year.

That’s not such bad news if the stock is actually worth something. But when the fall is from 80 cents to less than 40 cents, it’s a calamity piled onto a disaster.

However, you wouldn’t necessarily get that impression from the soothing opening remarks by chairman Roger Corbett, who told the small Melbourne audience of shareholders that despite the ravages of an “annus horribilis”, Fairfax Media is in good shape and in good hands.

That’s like Monty Python’s black knight claiming “it’s only a flesh wound” as he bleeds out, limbless on the forest floor.

This post is a work in progress; I have published today [June 27] to get the ball rolling, I will be adding to this post over the next 72 hours.

On Monday 18 June the sky began falling in the Australian news media. Within 10 days the world of Australian journalism had changed forever, but the change hadn’t stopped.

Over 3000 jobs were going to be purged from Australia’s two largest news organisations.

The West Australian mining mogul, Gina Rinehart, was poised over Fairfax Media like a vulture over the corpse of a dying baby.

We all knew why she was there; it was just a matter of time.

That was the week that was (June 18-24)

What is the future of newspapers? At the end of a week in which both Fairfax Media and News Limited announced seismic changes to their business – including ditching about 3000 jobs between them – what can we say about the printed news sheet?

Well, it seems that the answer is ‘heaps and heaps’. Millions of words have been written, blogged and spoken on the future of newspapers this week; tens of thousands of them even appeared in the newspapers themselves.

So what do we really know at this point?

Not much more than we did last weekend, is my quick answer.

The ‘perfect storm’ that hit Fairfax Media this week — with Gina Rinehart at its epicentre — has been a long time coming. The Fairfax share price has been on a really steep down slide for the last two to three years.

Today it’s under 60 cents, just three months ago is was over 70 cents. The last time it was over $1.00 was June 2011; it dropped under $2.00 in November 2008. It was last at $3.00 in June 2008 and we have to go back nearly six years to December 2006 to see Fairfax at over $5.00.

In contrast the News Corporation share price on the ASX has jumped from $16 to $20 since June 2011. It has been over $15 for the past three years despite some ups and downs and has risen from a low of $12.91 on 23 June, 2009.

This shows that the problems facing Fairfax Media are commercial and financial, not just or even mostly technological.

These problems are not brand new either. It is not the Internet that has caused the total collapse of the newspaper business model; it has been a long time coming. It is instructive to go back and look at the history of the newspaper industry in Australia to understand why we are in the situation of having the Rupert Rinehart duopoly looming over the news media’s future.

Fairfax has a new model

In the middle of the second week of this perfect storm – June 27 to be precise – things did become a little clearer.

Three senior Fairfax editors had left the newsroom for the last time. It seems that there was a period of negotiation – one incoming new EiC (see org chart below) admitted he had been in discussion with management for about two weeks.

Still, many reporters were shocked and emotional scenes were reported.

News Limited announced around 100 job cuts, mainly in regional areas, including the Gold Coast and Fairfax unveiled a new newsroom model to staff.

The Fairfax model looks a bit like the broken ferris wheel here in Melbourne and I can’t help wondering why some of the content wedges are bigger than others. Is it because they will get more attention in the new system of content brokerage across neutral platforms?

If it is then going ‘compact’, or ‘tabloid’ is about more than just the size of the page.

The Fairfax ferris wheel.Click to enlarge

The new Fairfax organisational chart is also worth taking a look at.

It’s not that different from a traditional newsroom structure in many ways, but the convoluted explanations of roles and responsibilities that accompany it are straight from a weak MBA dissertation.

Fairfax Org Chart: designed by a poor MBA student?Click to enlarge

In this model reporters who are covering breaking news are to be known as ‘first responders’, this gives the whole thing the feeling of a medical emergency.

And that’s what this is. It is an attempt to triage a series of seriously wounded patients on a bloodied battlefield.

The Fairfax mantra of journalism and integrity come first is pleasant soothing language that will hopefully comfort the afflicted, but when you rip the heart out of a newsroom no amount of placatory talking can alter the facts.

Then there’s the hovering vulture and her cronies.

In a statement released on 27 June, Rinehart’s advisers conceded that she might be prepared to negotiate and sign a new Charter of Editorial Independence, but this ominous set of phrases is where the really alarming detail bedevils:

“Active consideration of content or a change in content is required to attract readers and advertising revenue in the interests of shareholders, together with other options to increase revenue and hence share value.”

What does this mean?

Well, it can really only mean one thing: shifting the Fairfax editorial culture. But which way will it be shifted?

Most money is on the bet that Gina Rinehart will want to shift Fairfax to the right and into more ‘business-friendly’ reporting. This is assumed to include more climate change ‘scepticism’ and less criticism of the minerals industry.

However, it is questionable as to whether this will attract readers, increase advertising or enhance shareholder value.

It may well have the opposite effect as current readers of the SMH and The Age desert the papers in direct proportion to their rightward drift.

If this happens and the new tabloid-ified Fairfax mastheads begin competing with the Murdoch titles then the next logical step – to maximise shareholder value, mind – would be to merge the titles in Melbourne and Sydney and turn them into one-paper towns in line with the rest of the country.

That is the logic of shareholder value maximisation – or in blunt Marxist terms it is the application of the logic of capital accumulation.

It is also the history of the Australian newspaper industry.

In 1886 – just 128 years ago – there were capital city 48 daily newspapers in Australia. By 1903 that had dropped to 21; it was down to 17 in 1947, 15 in 1950, 14 in 1960 and it has continued to drop since. From the mid 1990s on the present situation became established.

Today there are 11 capital city dailies: two in Melbourne; two in Sydney; one each in Canberra, Adelaide, Hobart, Perth and Darwin and two that circulate nationally.

That is why questions of concentration, ownership and diversity are being talked about again in the context of both the Finkelstein report and the Rinehart push for editorial control at Fairfax.

The giant media fuss about Finkelstein and the frenzied cries of censorship and government control prompted me to look at the last government report into the news media, delivered to the House of Representatives in 1992. [I’ll come back to this].

News & Fair Facts

Just over 20 years ago, in March 1992, a House of Representatives Select Committee tabled its report into the Australian print media industry. It is worth looking at this report because it had bipartisan support and its findings make it clear that the issues that free speech alarmists are shouting about today have deep roots.

It is also interesting because the free speech alarmists — those who argue that government censorship is coming in the form of the Finkelstein report — would deny some of the language used in News & Fair Facts, particularly about the problems of monopoly and the concentration of media ownership.

For example:

On the basis [of figures given to the committee], the Australian print media industry generally is highly concentrated. In almost every sector of the industry one or two groups dominate in terms of the number of publications and related circulation under their control.

James Packer, Lachlan Murdoch, Kerry Stokes, John Singleton and Gina Rinehart. While Stokes and Singleton have been around media traps for a few years now, the return of a Packer, a Murdoch and the addition of Rinehart represents a changing of the guard for Australian media dynasties.

But this will not necessarily mean a return to a past where empires and family fortunes are entirely entwined. Perhaps, ironically, it signals the end of the dynastic age and the emergence of new corporate battles for control of media assets.

Gina Rinehart

Why buy?

Much attention has been focused this week on Australia’s richest woman, Gina Rinehart. Her play for Fairfax Media assets and her well-known disdain for “communist” journalists are a potent mix in these post-NOTW days.

There has been speculation and rumour about her motives, none of it substantiated, but all interesting.

I particularly like Stephen Maynes’ theory that Rinehart’s decision to raid into Fairfax was an act of hubris and rage at the unsympathetic portrait by Jane Cadzow in Good Weekend (published by Fairfax). From published accounts this seems a typical Rinehart approach to solving a problem.

Others raise the possibility that Rinehart and Singleton will now join forces to create a super network of right wing shock-jockery to campaign against Labor in the 2013 election. This is an attractive theory that aligns well with the suggestion Rinehart is a fierce warrior for conservative forces in Australia. It would be easy to do as Fairfax radio assets have been in play and Singleton’s Macquarie Network is a keen buyer.

Then there’s my favourite theory: Rinehart will grab the Fairfax papers, leaving the rest of the company behind. She will gut the current communistic news staff and hire a bunch of young Liberal communications majors; thus turning the SMH and the Age into simulacra of The Australian’s right-wing bile factory.

All equally attractive propositions to Rinehart’s lovers and haters alike. There’s no doubt her actions have polarized the media landscape and created turmoil in the already fragile media asset market.

This disturbing footage was released by Get Up Australia. It clearly shows climate change denier and libertarian organiser Lord Monkton urging the establishment of a Fox-like media outlet in Australia funded by one of the super-rich.

It puts a new slant on the Rinehart putsch on Fairfax Media shares this week.

There’s been some excitement on the bourse and in media boardrooms this week over Gina Rinehart’s move on Fairfax Media. It seems the West Australian iron ore magnate is angling for a seat on the Fairfax board to add to her $165 million berth at the Ten Network.

Rinehart is keen to take her original 4 per cent stake of Fairfax to about 15 per cent. She bought the first shares for $100 million and is likely to spend close to $200 million on this raid.

But what are the real implications in this venture?

There’s been speculation that the Communications Minister, Senator Stephen Conroy, might move to block Rinehart’s attempted takeover of Fairfax – if indeed that’s what it is. The grounds for such a move would perhaps be that she’s not a fit and proper person to own media assets because of her alleged political bias. Rinehart is a vocal opponent of the Labor government and its resource rent tax scheme. The timing of Rinehart’s grab has created talk about the blocking move by Canberra. She’s made the play as the final report of the Convergence Review on media and communications is due to be handed down, and in the knowledge that the current convoluted and unworkable media ownership rules will be changing.

Blocking any takeover is open to the regulators under provisions of the Trade Practices Act dealing with matters of public interest. A strong case would have to be made that Rinehart’s control would lessen media competition. There is no “media” law that prevents her actions now and even less under the proposed new regulator.

But, for me, the timing is coincidental. Rinehart is buying Fairfax shares under the existing rules, which limit audience share across platforms and across markets. She is therefore entitled to increase her stake in Fairfax – while holding significant shares in Ten – as long as she does not control the companies and her combined media assets do not constitute a breach of the “three-and-two” rule (where companies are allowed to own up to two media outlets — TV, radio and newspaper — in a single area).

There’s also the issue of the government’s legislative and political timetables to consider. Filling in the substantial missing detail in the Convergence Review’s recommendations is going to take months, if not years. The timeline could stretch well beyond the next election cycle. We will be playing by the old rules for a while yet.

Rinehart’s decision to move now can be explained without recourse to conspiracy theories or invoking the “evil witch of the West” stereotype. She is cashed up; the Fairfax share price is ridiculously low (down from about $5 five years ago to less than 90 cents today) and by taking a chunk of stock she gains leverage over the company at a time when it needs to transition from being primarily about ink on paper to being truly converged and multimedia.

Rinehart may well be thinking long-term and looking for business synergies, cost-savings and profit-taking by joining up her investments in Ten and Fairfax. She would effectively then be able to either harmonise these business units to create a going concern, or sell-off strategic assets once the new ownership rules and content regulations are in place.

Whatever her motives, Gina Rinehart still has to play by the rules. She cannot easily move to positions of control of both Ten and Fairfax Media under the current cross-media ownership regulations without a fight. Under the mooted new rules she would also have to pass the public interest test.

Having said that, I don’t think it is useful to demonise Rinehart and suggest that she has an ulterior personal and political motivation for taking on Fairfax. She has strong and very conservative political views and she has been spending some of her inherited mining wealth on anti-government campaigns in recent months, but I am not sure that Gina Rinehart is another Kerry Packer or Rupert Murdoch waiting in the wings.

Rinehart is incredibly rich and she has seen an opportunity to buy a media asset while it is at or close to the bottom of its share price cycle.

What we should be concerned about is that this share market play makes a mockery of the idea that the news media and the press are somehow bastions of free speech and freedom of expression.

According to her own family, Rinehart is a tough woman and as hard as the ore her father dug out of the Pilbara to create her vast fortune.

She will have to be resolute if she is to take on Fairfax journalists who have fiercely defended their independence in the face of perceived corporate interference. Readers of Fairfax publications may also not take too kindly to Rinehart’s editorial line.

Her solution might be, as some have suggested, to wrestle control of the major Fairfax dailies and leave the rump to be sorted by the board. This scenario rests on Rinehart’s motivation being influence rather than profit.

Rinehart’s multimillion-dollar raid on the Fairfax share cupboard just goes to show that the adage “freedom of the press belongs to those who can afford to buy one”, still applies in convergent Australia.

Rinehart’s estimated wealth is staggering – she’s rumoured to be one of the richest people on the planet – so she can easily afford to buy Fairfax and whatever she damn well wants, but there are many hurdles to jump before she can claim the throne as Australia’s princess of print.